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Thursday, 30 October 2014

Understandably the Daily Mail has its main story the sad death of Michael Payne, father of of Sarah Payne who was murdered in 2000. Given his death is attributed to alcohol abuse it's more than a little insensitive to run with this story directly underneath:

Tuesday, 28 October 2014

One possible positive that may be garnered out of the debate yesterday on the Recall of MPs Bill is the fact that the debate is even happening at all is tacit acknowledgment within the Westminster that something has gone wrong with the system.

But it was of no surprise that Conservative MP Zac Goldsmith's proposals, which would have
excluded Parliament's standards committee from any role in determining
whether errant MPs should face re-election, was defeated - it is entirely within character that MPs would be somewhat reluctant to support reducing their powers with enthusiasm. It therefore was of some amusement the naive astonishment shown in some quarters on social media at MPs unwilling to give up powers.

All of this though misses the point. The debate regarding the recall of MPs is Westminster talking to itself - the proposal nothing more than a tinkering around the edges while in effect maintaining the status quo. Very much a politician's solution then...

Unwittingly Zac Goldsmith betrays this view in his arguments in favour of his proposals by trying to persuade MPs and Ministers that they have nothing to fear from recall decided by the people because it would very rarely be used:

The third concern relates to the fear that Members would face endless
recall attempts, amounting almost to a form of harassment, an issue
raised several times in last week’s debate. I see no need for a limit,
as the experience of recall around the world shows that its use is
extremely rare and that it is used only in extreme circumstances. In 100
years of recall in the United States, where there are virtually no
financial controls or controls on broadcasters and so on, it has
happened only 20 times. There have been 40 recall referendums...

Far from leading to a flood of
vexatious attempts to remove sitting MPs, this second stage makes it
almost impossible to oust a sitting MP on partisan grounds. Note how
few recall attempts have ever been successful in California.

In other words, vote for this measure because it won't make any difference at all. It's a ... er ... curious argument to make for a democratic device to say the least.

It's safe to assume that the great expenses scandal of 2009/10 is a cloud hanging over the recall debate, with examples such as Labour MP Margaret Moran going into hiding leaving her constituents unrepresented and they having no means to force a by-election.

Yet it is with some irony that the expenses scandal actually show up the ineffectiveness recall would have. While there was a lot of public anger, further provoked by MPs’ attempts to prevent disclosure under Freedom of Information, voters did not punish them electorally in 2010.

Many MPs (and over 50% sought re-election) who were embroiled in the financial scandal were still re-elected in the 2010 election. Take Alistair Darling for example, who abused taxpayer's money by 'flipping' his two houses four times was re-elected in 2010 with an increased majority.

The report finds instead that there was only a modest 1.5% voting impact on MPs implicated:

We find that implicated MPs received a vote share about 1.5 percentage points lower than non-implicated MPs (after controlling for incumbency, region, and previous constituency results). Intriguingly, we do not nd an association between vote share and either the amount the MP claimed in expenses or the amount an MP was required to repay...

The findings may not be so surprising when we consider that the representative ballot is a blunt instrument to deal with the complexities of voters' concerns such as the economy, immigration and of course partisan competition. Thus the report comes to an interesting conclusion:

The degree to which voters punished individual MPs for expenses abuses (a drop in vote share of about 1.5% on average) is modest in comparison to voters' responses to corruption in the US and other settings, but the lower magnitude seems reasonable given the fact that most British MPs have few individual powers and British voters have no other opportunity to express a party preference at the national level.

The findings thus illustrate the fact that the degree to which electoral accountability can constrain individual politicians depends on political institutions including the electoral system, separation of powers, and legislative organization.

A better example of why recall won't work would be hard to find and further demonstration that something far more radical is need to grap MPs by their goolies - The Harrogate Agenda.

Sunday, 26 October 2014

Following on from our previous post on Telecoms, we intend to address more fully the complexities of European and international political and regulatory networks of telecommunications which present significant challenges when considering Brexit. We begin here though as background with the impact of the rise of the mobile phone before we move in further pieces which look at national, EU and international regulation in detail.

As would be expected due to its inherent nature regarding communication, telecoms is a truly globalised industry which is reflected by the fact that many of its well known companies are multi-national businesses. For example the biggest and most valuable telecoms giant is US-based AT&T which provides mobile and fixed-line telephone service and broadband cable whose overall revenues grew to more than $127 billion in 2012. UK based Vodafone is the world’s second largest mobile phone operator on revenue and subscribers, behind only China Mobile.

Yet the rapid advancements in the last 30 years in technology have not only been reflected in the diversity of services provided by telecoms companies but also that the market is now populated extensively by what are traditionally non-telecoms specific enterprises.

We can appreciate the rapid advancements most acutely when we consider that in the time it took fixed lines, since the invention of the phone some 140 years ago, to progress from analogue, to digital circuit switching and then to packet switching technology courtesy of VoIP, it has only taken mobile phones around 30 years to achieve the same progression path.

When the traditional telephone was first challenged properly by the mobile phone in the early 1980’s operating on a cellular network– it was essentially by a two way radio which operated on two different analogue frequencies in order to receive and transmit conversations at the same time. It was an advancement on Push-to-Talk technology.

The rapid rise of early mobile phone efforts and vigorous competition though meant incompatibility of technology between carriers and also capacity problems. Other problems were that some services in the UK services such as Rabbit, Phonepoint and Mercury Callpoint could only make outgoing calls near a designated base station.

Even in the United States by the mid 1990s, there existed competing and incompatible second-generation digital wireless — channel access technologies such as CDMA (code division multiple access), TDMA (Time division multiple access) and iDEN, ensuring that phones would not work from one system to another.

The situation in Europe in the early 1980s was initially even worse. The first European mobile cellular systems were introduced in Scandinavian countries in 1981 and 1982. Following on shortly were the likes of Spain, Austria, the UK, Netherlands, Germany, Italy, and France. These systems were all analogue, now known in hindsight with the technological advancements as first generation (1G), however the problem was that there were eight of them which were all different and incompatible. Thus mobile communication was generally restricted to one country only.

This led to the intervention by the Telecommunications Commission of the European Conference of Postal and Telecommunication Administrations (CEPT), a voluntary association of European countries where policy makers and regulators from 48 countries across Europe collaborate to harmonise telecommunication, radio spectrum, and postal regulations. The CEPT established a study group called the Groupe Speciale Mobile (GSM) to develop the specifications for a European-wide second-generation digital cellular system in the 900 MHz band.

The requirements were that it was to be fully digital, incorporating the best technology of the time. There would be no backward compatibility with existing systems and they desired that their new wireless standard would be similar to landline requirements for ISDN, hoping to make a wireless counterpart to it.

Here conflicts emerged between the national self interest of countries, of mobile phone companies and the need for standardisation.

The GSM group wanted to select the most appropriate technology by assessing a number of demonstration systems by interested parties. Eight systems were submitted which were between broadly TDMA technology and those incorporating CDMA technology. TDMA and CDMA were split along Scandinavian countries (Nokia, Ericsson and Elab) and the Germany/France axis respectively - whose systems were heavily subsidised by the French and German governments. The split reflected differing demographic characteristics between the countries.

TDMA with its fewer time slots thus its relatively moderate traffic capacity was less cost intensive and meaning it was easier and quicker to rollout across rural communities. Conversely the systems of Franco/German origin were generally designed with high traffic capacities in mind. This was a cost effective solution in more urban and dense areas with high traffic-density requirements but is more expensive for rural areas where many time slots are not needed.

Yet at least if not more as important as technology were; political issues, property rights issues and vested interests. Obviously the stakes were enormous for suppliers and states. One of the two shortlisted by SEL/Alcatel was considered to be “too proprietary” and held the patents on its CDMA-based proposal. There was reluctance by some countries to approve the other shortlisted option (TDMA) submitted by Ericsson due to it being based in a country that at the time was not a member of EEC. Other disputes included the use of encryption in GSM (A5/1), with eventual agreement that it should be optional – countries such as France do not allow it to be activated.

that the Governments of the Member States ensure that:
- the telecommunications administrations:

1. consult each other, preferably in the framework of CEPT, before they introduce any new service, notably between Member States, with a view to establishing common guidelines so that the necessary innovation takes place under conditions compatible with harmonization;

It was not until the Treaty of Maastricht (Article 129 D) that, for the first time, the EU was given a competence in the field of telecommunications. Instead it was diplomatic efforts by individual countries, notably by the UK, that lead to a breakthrough which came via the Bonn Declaration in 1987. This confirmed that a decision had been reached to use TDMA
technology:

Europe must have a single standard supported throughout the CEPT- This should be based on the narrowband TDMA concept defined by CEPT at its Madeira meeting in Feb 1987.

The ministers also called for the agreement between network operators to be formalised by a Memorandum of Understanding (called the GSM MoU) which they did, not long after:

The signatories shall support the open (non proprietary) definition of at least the following interfaces in the form of CEPT recommendations:

Mobile/BaseStation (air interface) based on the narrowband TDMA concept defined by CEPT at its Madeira meeting in Feb 1987 enhanced in the areas of modulation and coding to provide the greatest flexibility in receiving equipment implementation as agreed by CEPT GSM at its Brussels meeting 9-12 June 1987

In 1987 the then EEC adopted, via Council Directive 87/372/EEC, frequency allocations proposed by the CEPT covering the 25 MHz bands of 890 - 915 MHz for uplink - mobile to base station, and 935–960 MHz for downlink - base station to mobile to apply to the Single Market.

(Interestingly the rights to the GSM trademark and logo were held by France Telecom)

The first GSM systems were up and running by 1991 with Vodafone launching the UK's first GSM commercial service in the same year. Having been deployed throughout Europe, GSM allowed smooth roaming from country to country.

More than 6 billion people worldwide use the Global System for Mobile Communications (GSM) family of technologies. GSM is the most widely used wireless technology in the world, available in more than 219 countries and territories worldwide, with a market share of more than 90 percent.

What made GSM so successful, was not that it was a far superior technology - indeed the first GSM handsets in 1992 were not much better than the old analogue ones - but instead that it established a complete telecommunications network in one package. Other worldwide standards bodies only produced a specification for the radio piece of the mobile network. Automatic roaming and handover of calls between base stations required dedicated exchanges for numbering and switching management and this is what GSM provided. It turned out to be a very successful illustration of European co-operation, ironically, with little involvement of the EEC/EU.

Born out of the 'GSM MoU' in 1987, and powered by the success of GSM, was the emergence of the GSM Association (GSMA) which represents the interests of mobile operators. Thus GSMA has "evolved to become one of the most powerful trade associations in the world, lobbying governments on everything from tax policy to pricing strategy":

Spanning more than 220 countries, the GSMA unites nearly 800 of the
world’s mobile operators with 250 companies in the broader mobile
ecosystem, including handset and device makers, software companies,
equipment providers and internet companies, as well as organisations in
industry sectors such as financial services, healthcare, media,
transport and utilities.

In 1988, created by CEPT the European Telecommunications Standards Institute (ETSI) was established. ETSI is an independent, not-for-profit, standardisation organisation in the telecommunications industry and, although not an EU organisation, it is officially recognised by the EU. Crucially ETSI allows direct participation in its technical committees from non-EU companies that have commercial interests in Europe which means it has a global outlook and influence - for example it was a founding member of the Global Standards Collaboration.

GSM thus was a big success, and probably due to this success 'Europe' began to become complacent - an unwise position to take as technology marches on relentlessly. While GSM second generation (2G) cellular systems were used principally for the purpose of transmitting voice calls - there was a growing use for the transmission of data. GSM acknowledged this with the flexibility of using Signalling System No. 7 which was essential to support new data services and SMS (text messages). Within a decade one billion text messages were being sent in a month. The development of third generation (3G) meant that term 'mobile broadband' reflected the growing demand for phones to emulate domestic PC broadband speeds.

While GSM was ultimately a triumph of European co-operation without the intervention of the then EEC, it was inevitable that the EU would use telecommunications as another excuse for further political integration which it retrospectively added to the Maastricht Treaty. Not unsurprisingly since becoming an EU competence the progression of telecoms innovation and co-operation within Europe has not been much short of stagnation.

There is broad agreement that the EU mobile wireless market is underperforming relative to other advanced economies, including the U.S. We find that the EU is lagging well behind the U.S. in deployment of next generation wireless infrastructures and the advanced services they make possible, and that EU consumers are worse off as a result.

EU regulatory policies have resulted in a fragmented market structure which prevents carriers from capturing beneficial economies of scale and scope and retards the growth of the mobile wireless ecosystem. We recommend reforming and harmonizing spectrum policies, permitting efficient levels of consolidation, and promoting innovation by fostering dynamic competition.

It then notes that:

Growth in investment in the U.S. is translating into faster data connection speeds: U.S. speeds are now 75 percent faster than the EU average, and the gap is expected to grow.

The U.S. is deploying ITE at a much faster pace than the EU; by YE 2013, 19 percent of U.S. connections will be on lTE networks compared to less than two percent in the EU.

LTE 4G data networks will have the potential to make different streams needed for mobile voice and data services obsolete. Traditional cellular
networks require a separate stream to carry voice traffic and data network. With LTE, rather like VoIP on landlines, voice traffic can be carried by IP technology, known as Voice over LTE (VoLTE). The final convergence for mobile phones is following the path trod before it by traditional land lines where the technology of VoIP has begun to establish itself.

Thus with the potential abolition of circuit switching technology within mobile phones this process to just being a mini computer will be complete. What for some time was effectively a phone with just some relatively simple software during the ‘90s where phones could text and allow users to play simple games like snakes as epitomised by the utter domination of Nokia, has become instead, with the development of smartphones, a small computer with telephony attached almost as an optional extra.

This convergence regarding mobile phones means we see telecommunications becoming an important component of the broader IT industry as companies such as Google with Samsung and Microsoft with Nokia enter the telecoms market.

In many ways the complexity of telecoms and indeed international regulation is demonstrated most clearly by the smartphone – the complexities of modern international regulation laid bare by a device small enough to fit in a pocket. A modern smartphone contains many technologies which are regulated in different ways, by way of an example modern phones tend to have the following features for example:

Bluetooth: Regulated by the United Nations Economic Commission for Europe (UNECE): "Before launching a Bluetooth classified product it must be
ensured that the product is in compliance with the international RF, EMC,
Safety and Health standards set by the regulatory authorities of the various
regions."

WiFi: Products are certified by the WiFi Alliance, which is a global non-profit industry association stating "The members of our collaboration forum come from across the Wi-Fi ecosystem and share a vision of seamless connectivity. Since 2000, the Wi-Fi CERTIFIED™ seal of approval designates products with proven interoperability, industry-standard security protections, and the latest technology.

GPS: Civil signal designs are owned by the US as confirmed by this statement in 2013 "The governments of the United Kingdom and the United States of America
today announced that they had reached a common understanding of
intellectual property rights related to the Global Positioning System (GPS) and will work together to address broader global navigation satellite systems’ intellectual property issues.

NFC/RFID: Near Field Communication - technology in smartphones which allows contactless electronic payments. It is based on the international ISO/IEC 18092 standard.

Camera: Photographs made with a camera phone can fall outside the jurisdiction of the EU: "A photographer who requested Wikimedia to remove one of his images used online
without his permission has had his wishes dismissed, with the US
organisation behind Wikipedia claiming that because a monkey pressed the shutter button it should own the
copyright".

Ringtones: Companies who offer ringtone services to sell to the UK public pay royalties to PRS for performance rights.

What this illustrates neatly is that the telecommunications field is so vast, and changing so rapidly, it is difficult to cover all aspects of it. But its globalised complexity requires global involvement.

In the next few blog pieces we will concentrate on national, European and international telecommunication regulation in turn.

Tuesday, 7 October 2014

My previous piece reflected on the free bet that is the offer of a referendum in 2017. It maybe that Cameron doesn’t deliver, and that is of course a risk, but it’s the only offer currently on the table. We should remember that extracting this promise from Cameron has long been UKIP policy. For example in 2011 (2 years after “cast iron”) Farage had this to say:

…Ukip could form an electoral pact with the Conservatives at the next election if David Cameron were to promise a referendum on membership of the European Union. There was "every chance of forcing David Cameron into giving us a referendum", he said. Whether or not to propose an electoral pact with the Conservatives in 2015 would be a "huge decision" for the party, he said. But he had offered the Tories a pact before the 2010 election, he said.

Given Cameron’s track record it’s reasonable not to trust him, though that would imply that other politicians can be trusted. However in my view the question of trust doesn’t come into it. If Cameron wins in 2015, albeit with a small majority, he won’t have any choice but to deliver lest the party give him an offer he can’t refuse. Less a case of trust, more a case of pure political calculation.

If there is to be a referendum in 2017 then another obvious concern is that it will be loaded in favour of staying in. It’s worth noting at this point that exit is very unlikely to ever occur without a referendum being offered and won. The precedent for constitutional change has now been set with the referendum in 1975, Scottish & Welsh devolution, the AV vote and the Scottish independence vote. Nor indeed can we expect ‘perfect conditions’ for one being held.

It’s certainly going to be a challenge to overturn the message of the establishment, media and FUD all of which will be heavily funded. An example of this was during our entry into the then EEC where pro market lobby groups were co-ordinated under the umbrella of the European Movement part funded by the EU Commission to act as an integral part of the government campaign. Efforts were made to bring the media on board particularly the BBC where eurosceptic presenters were dismissed in favour of more sympathetic ones.

However this is not 1975, the world has moved on in 40 years and as a consequence we do have a number of potential advantages over that campaign which can help nullify if not overcome the challenges.

The EU:
The first advantage is that the EU is no longer just the EEC or a ‘Common Market’. In some 40 years since UK membership the EU has taken ever larger strides towards political union such that its ultimate goal has become much more obvious.

Now it is a ‘European Union’ rather than a ‘Market’. By calling it a “Common Market” meant the 1975 referendum was defined by the terms pro-marketeers and anti-marketeers – membership argued in simple economic terms. Thus in this context Wilson was able to get away with his sham negotiations by reducing it down to the level of import quotas on New Zealand butter and cheese.

40 years on, Cameron could not get away with anything so lightweight. It’s no longer a Market but a Union. Thus there would be demands for a far more substantial return of powers - none of which can be achieved without Treaty change. And that leads us neatly onto the next advantage...

David Cameron:
As has been well documented Cameron did not want a referendum nor does he want to leave the EU. That he has offered a referendum against his wishes is a reflection of his political weakness not his view that he thinks he can win it. We know this because he has made a political mistake. His offer was due to being under pressure from backbenchers who in turn are under pressure from UKIP in the belief that such a promise would win him the next election, and it is an offer made regardless of what concessions Cameron thinks he can spin from Brussels. It is very likely he chose the date as the UK takes over the Presidency of the Council of the EU rather than any other consideration.

The reform option has always been dangerous as it splits the “out” vote to the benefit of those who wish to remain EU members. However Cameron’s promise largely negates the reform option as he can’t possibly hope to have any substantial concessions which he can put to the electorate by 2017. The changes needed to the founding Treaties simply cannot be achieved in time. Thus all he can rely on is what will be unconvincing spin without substance.

And this is where his track record of ‘PR man’, ‘cast iron’ and ‘lack of trust’ becomes an asset to the out campaign. Without Treaty change it will be spin few will believe and it is a mistake we can capitalise on. A mistake that Clegg appears to appreciate very acutely during the Lib Dem conference:

The Lib Dem leader said he was committed to a vote when there was EU treaty reform, but criticised the "arbitrary date" of 2017 set by the Conservatives.

It’s worth noting that the Scottish referendum also had superficial promises of the reform option announced by, among others, Gordon Brown who tried to rewrite the UK constitution on the back of a fag packet in an impassioned speech by offering essentially devo-max to the Scots. Yet the pledge of reform made little difference to the final results which were in line with months of predictions by the polls. Other core substantive issues instead decided the referendum which we will explore later in this piece.

Experience:
The 1975 referendum was the first ever in the UK, thus there was no real direct experience to draw upon. As a result many mistakes by both sides were made, not least in the failure of establishing a coherent message particularly from the anti-marketeers - with the word 'anti' portraying negative connotations, In contrast we have the opportunity to learn not only from the referendum of 1975 but subsequent ones over AV and Scottish independence, and we can endeavour to try not to repeat mistakes made there.

The Internet:
In 1975 the media and all the newspapers bar one – the communist Morning Star – supported EEC membership. Such support would be similar today, including from the likes of the Daily Mail which in editorials has made it clear it supports EU membership.

However unlike 1975 we now have the internet and everything that comes with it; smartphones, Twitter, Facebook and forums. The establishment no longer has a monopoly on information. Scotland revealed the significance of this development. The independence campaign was a dry run of how an EU referendum would be conducted and it showed comprehensively that unofficial campaigns centered on social media was very powerful.

The 2008 US election showed how politicians could use it as a campaigning tool, but it wasn't until the Scottish referendum that Britain really caught up.

According to Facebook, more than 10 million interactions were made about the fight in a month. So who won the social media wars - and what can we learn from it? The simple answer is: the Yes campaign was victorious.

The official Twitter account of the Yes campaign has an impressive 103,000 followers compared to 42,000 for Better Together. Alex Salmond boasts 95,000 Twitter followers and Nicola Sturgeon has 66,000 - while Alistair Darling has just 21,000. On Facebook, the Yes campaign page attracted more than 320,000 likes compared to 218,000 for the No.

But debate was not only held on the most well known outlets, there was much passionate debate on forums such as Celtic Football Club’s which ran to an impressive 1674 pages.

It’s also worth noting that during any campaign the URL address http://www.eureferendum.com/ would be much sought after – and this is already registered by Richard North. Typing the words “EU Referendum” into a search engine and links to the country’s premier eurosceptic blog comes top of the search results.

Thus with the internet we can bypass the mainstream media. This is a tactic that was used by Farage in UKIP’s early days. Comprehensively ignored at the time by the media, Farage went under the radar by taking the message direct to people by travelling the country and addressing local meetings. He was to replicate this method in 2013 with the Common Sense tour.

As UKIP proved, such methods can be very effective in getting the message across despite the bias of the legacy media and so it can prove with a referendum in 2017.

There's a strong anti-establishment vote:
Unlike 1975 where there was more deference to the political system, we now have the obvious decadence
of Westminster politics. A decadence which reveals itself by the
increasingly lack of quality in MPs, hopeless leadership, the lack
of relevance of political parties with membership plummeting, and the
electorate itself being treated with contempt and their anger in return.

Revulsion
at this decadence and alienation from Westminster is common to both
England and Scotland. In England it expresses itself partly in UKIP; in
Scotland it helps power the SNP.

Thus unlike 1975, the parties of
Westminster campaigning as one in 2017 to stay in the EU could actually prove to be useful as part of an
effective anti-establishment campaign which when based around sound exit answers can win
over a lot of people, as was shown in Scotland.

The establishment is not always united:
The Scottish referendum illustrated that the establishment campaign epitomised by Better Together was not always united. Although they shared the same aims of keeping the union together the fundamental differences between parties and between themselves could not help coming to the fore. Gordon Brown was sidelined until the last minute, Darling was consistently criticised for running a poor campaign, for example in May 2014:

Alistair Darling has effectively been dumped as head of the campaign to keep Scotland in the UK following crisis cross-party talks.

A Labour MSP has criticised his party’s decision to “hold hands” with
the Tories in the ‘Better Together’ alliance against Scottish
independence and has claimed that the No campaign is now unable to
“outline a coherent vision”.

The 'in' campaign is likely to be as split as the 'out' one.Having a major party on board is not always necessary:
As the SNP found out to its cost, a major party with an official position does not always mean party supporters and members follow suit - voters in Salmond's own 'backyard' of Aberdeenshire gave independence the thumbs down. Official positions of Labour and the Tories in an EU referendum are likely to be very different to its members when deciding on an EU referendum and there are likely to be splits within.

The question has already been decided:
Should Cameron endeavour to progress with a referendum then it's out of the question that he can manipulate the question. The Electoral Commission has already given its advice to Parliament - the full details of its advice can be found here. In summary it advises:

If Parliament wants to retain the use of ‘Yes’ and ‘No’ as response options to the referendum question, then the Commission has recommended that that the question should be amended to:

'Should the United Kingdom remain a member of the European Union?'

If Parliament decides not to retain a ‘Yes’ and ‘No’ question, the Commission has recommended the following referendum question:

'Should the United Kingdom remain a member of the European Union or leave the European Union?'

The European Economic Area (EEA):
Unlike in 1975 we have an off-shelf economic model in form of the EEA which can successfully nullify the FUD which will undoubtedly be deployed to portray by fear that leaving would be economically disastrous. The EEA was designed as a ‘stepping stone in’ for reluctant countries such as Norway and this can very easily be used as a ‘stepping stone out’. The economic arguments of 1975 would be made redundant:

Let us be clear about one thing: In or out of the Common Market, it will be tough going for Britain over the next few years.

In or out, we would still have been hit by the oil crisis, by rocketing world prices for food and raw materials.

But we will be in a much stronger position to face the future if we stay inside the Market than if we try to go it alone.

Inside, we can count on more secure supplies of food if world harvests turn out to be bad. And we can help to hold down Market food prices - as we have done since we joined in 1973.

The EEA therefore allows us to sideline the economic arguments effectively and so use the referendum to concentrate on the political aspects of the EU which prove to be so unpalatable for the British people (my emphasis):

Public opinion is divided on the detail of Britain’s role in Europe, however. Around three in ten each would prefer to see ‘Britain’s relationship with Europe remaining broadly the same as at present’ (32%) and ‘Britain returning to being part of an economic community, without political links’ (30%). One in five would like to see ‘Britain leaving the European Union altogether’ (20%), with ‘closer political and economic integration’ with other EU member states the least favoured option (13%).”

The 1970's pessimism has gone:
It's not unreasonable to suggest that the early 1970s provided probably the only window of opportunity to have joined the EEC. The UK was beset by a national lack of self confidence not long after "Great Britain had lost an Empire and had not yet found a role", the Suez crisis, devaluation in the 1960's, a global recession, spiralling inflation, collapse of Britain's traditional manufacturing industries and rising unemployment and industrial unrest.

With this in mind it's easy to understand why the UK sought refuge in the EEC. Yet largely as the result of the Thatcher reforms of the 1980s, the UK escaped from the inward straightjacket of its past. Rather than pessimism overshadowing the next referendum a confident UK will now be able to take advantage, outside the EU, of the dominating factor of trade...

Globalisation:
Nothing illustrates the ever decreasing need for single market access for the UK than the rise of globalisation. This is the EU's redundancy notice, its P45. The EU is a relic of the 20th century, a time when the cold war dominated, when memories of war on the continent were still painfully fresh. Yet during the late 1970s and 1980s we had the emergence of other markets such as Japan.

Fueled by the evolution of technology, improved transport (Containerisation) and the growth of multinational companies and trading blocks globalisation is now the dominating factor. With the growth of China and India, the United States for example is increasingly looking east rather than to the EU in terms of importance of trade.

With globalisation has come the increasing importance of global bodies setting international standards. The Single Market, is a collection of
regulation which drives the harmonisation of standards, with a view to
not only facilitate trade throughout the Communities but to lead to increasing "political union" in the EU. It has primarily a political objective not an economic one.
However the EU acquis of harmonisation is gradually being replaced by international
regulation which does not have the same political overtones. As such the EU loses its European distinctiveness and simply becomes a property
shared by all members of the WTO, which they will all use as the basis
for international trade. The EU's Single Market thus will become redundant. Gradually it is being
replaced by the globalised market.

As it stands, as long as we are in the EU, we have a subordinate
position, (only 8% of the vote within the EU) on international bodies and the agreements on international standards are negotiated
and approved by the EU on our behalf.

However EFTA/EEA countries such as Norway are able to
negotiate for themselves at the top international table and only after they have agreed them are they
then processed into actionable law and passed down to regional trading areas such as the EU. The following graph illustrates how this works:

The early '70's demonstrated the UK's lack of ambition and self-confidence by tying itself to an inward-looking customs union based on the European continent. A 2017 referendum will give the opportunity to argue instead for a vision which was not available in 1975 - a vision that embraces the globalisation one which the UK can fully participate in.

An Exit Plan:
With the above in mind it is essential then that there is a detailed, workable and credible exit plan. Nothing illustrates this better than what has been very apparent from the Scottish independence referendum. The 'yes' campaign was not undermined by FUD, nor by the closing of ranks by the establishment, nor by a loaded referendum question nor by the lack of funds. Instead what the polls clearly showed is Salmond lost primarily due to not answering the currency question:

Meanwhile so far as the issues are concerned, if the Yes side does lose
it will probably have done so not least because it never managed to
persuade a majority of Scots that the country would be more prosperous
under independence. YouGov find in their latest poll that only 35% think
Scotland will be economically better off under independence while as
any as 47% reckon it would be worse off.

Of course, describing the patterns of the kinds of people who were more
or less likely to vote Yes or No does no more than give us clues as to
why people voted they way they did. What we can note at this stage is
that women, older people, those in ABC1 occupations and those born
elsewhere in the UK were all, according to YouGov’s final poll for The Times and The Sun,
relatively pessimistic about the economic consequences of independence.
And as we have repeatedly noted on this site, nothing seemed to matter
more to voters in deciding whether to vote Yes or No than their
perceptions of the economic consequences of leaving the UK.

In other words Salmond did not have a well thought out exit plan to deal with the basics. And failure to address the core problem of currency if Scotland left the Union then plants further doubts in voters' mind about other issues such as; defence, NHS,oil, immigration, EU membership, the Monarchy, pensions and so on. If Salmond had provided answers to these then it is very likely we would be looking at an independent Scotland.

One of the fatal flaws of the 1975 campaign was its inability to come up with a credible alternative to then EEC membership, a situation replicated by Salmond. With a fully workable exit plan we can avoid that flaw and crucially win...Eurozone:
This is the joker in the pack. Without yet a resolution to the inherent problems of the Eurozone namely it's still only an economic union without the political union necessary its problems are far from resolved. Given that a referendum is likely to take place in September of 2017 (during the UK Presidency of the Council of the EU) it will be at a time that is traditionally one of market turbulence. We could see a Eurozone crisis right in the middle
of a referendum campaign.

In many ways therefore we can see that winning a referendum in 2017 is perfectly possible. Reluctance to take a calculated risk until conditions are just 'perfect' obviously begs the question if not in 2017, then when?

Flexcit

EU quotes

"[There's no way Britain could accept that] the most vital economic forces of this country should be handed over to an authority that is utterly undemocratic and is responsible to nobody"(British Prime Minister Clement Attlee in response to the Schuman Plan 1950)

"We should frankly recognise this surrender of sovereignty and its purpose."(Edward Heath, Hansard, 17 November 1966)

“America would welcome it if Britain should apply for full membership in the [EEC], explicitly recognising that the Rome treaty was not merely a static document but a process leading towards political unification.”(George Ball Under-Secretary of State for JFK 1961)

"The single market was the theme of the Eighties; the single currency was the theme of the Nineties; we must now face the difficult task of moving towards a single economy, a single political unity".(Romano Prodi, 13 April 1999)

"Let's imagine Europe is a football club and you join, but once you're in it you can't say let's play rugby". (French foreign minister Laurent Fabius)

"We perform the duties of freemen; we must have the privileges of freemen ..."(Chartists 1836)

"The [Lisbon Treaty] is indeed a tidying -up exercise, it sweeps the rest of our sovereignty under the Brussels carpet".(Lord Pearson)"The Government’s guiding principle was...to swallow the lot and swallow it now."(Sir Con O’Neill, the British diplomat who led the UK’s negotiations for EEC membership under Heath)

"I look forward to the day when the Westminster Parliament is just a council chamber in Europe."(Kenneth Clarke, Conservative Chancellor in International Currency Review Vol 23 No 4 1996)"The EU is the old Soviet Union dressed in Western clothes"(President Gorbachev)

"Europe's power is easy to miss. Like an 'invisible hand', it operates through the shell of traditional political structures. The British House of Commons, British law courts, and British civil servants are still here, but they have all become agents of the European Union implementing European law. This is no accident."(Mark Leonard co-founder and director of the European Council on Foreign Relations, the first pan-European think tank)

"We need to build a United States of Europe with the [EU] Commission as government".(Viviane Reding, EU Commissioner 2014)

"A supranational union is a multinational political union where power is delegated to an authority by member states".(Wikipedia)

“A coup d’état by a political class who did not believe in popular sovereignty”.(Tony Benn on the European Communities Act 1972)

"Once [WWI was over, countries] went back to rules & customs of parliamentary democracies. I felt out of my depth".(Jean Monnet, Father of EU')

"EU Parliament is incredibly responsive to lobbying institutions, but is unresponsive to public opinion".(Gisela Stuart, Labour MP 2009)"Europe will be forged in crises, and will be the sum of the solutions adopted for those crises".(Jean Monnet, Father of EU')

"I have lived in your future ….and it doesn’t work".(Russian dissident Vladimir Bukovsky on the EU)

"Determined to lay the foundations of an ever closer union among the peoples of Europe".(Treaty of Rome 1957)

"This Treaty marks a new stage in the process of creating an ever closer union..."(Maastricht Treaty 1992)

"This Treaty marks a new stage in the process of creating an ever closer union among the peoples of Europe".(Lisbon Treaty 2007)

"Never out on principle; never in on principle [regarding EEC membership]. It depends on the terms and whether it is best for Britain".(Labour leader Harold Wilson, May 1975)

"Now we've signed it - we had better read it"(Douglas Hurd, former Foreign Secretary on the Maastricht Treaty)"The supremacy of Community Law when in conflict with national law is the logical consequence of the federal concept of the Community"(H P Ipsen, 1964 - 9 years before the UK joined)

"[Norway] held a referendum [on the EU] that went the wrong way"(Douglas Hurd, former Foreign Secretary on the Maastricht Treaty)

"Public opinion will be led to adopt, without knowing it, the proposals we dare not present to them directly. All the earlier proposals will be in the new text, but will be hidden and diguised" (Valery Giscard D'Estang. on the Lisbon treaty)

"The Tories have been indulging in their usual double talk. When they go to Brussels they show the greatest enthusiasm for political union. When they speak in the House of Commons they are most anxious to aver that there is no commitment whatever to any political union."(Labour MP Hugh Gaitskell, October 1962)"It means the end of a thousand years of history."(Hugh Gaitskell - 1906-63, on a European federation; speech at Labour Party Conference, 1962)

"The Constitution is the capstone of a European Federal State."(Guy Verhofstadt, Belgian Prime Minister)'If it's a Yes we will say "on we go", and if it's a No we will say "we continue".'(Jean-Claude Juncker, President of the European Council)

“The substance of the Constitution is preserved. That is a fact.”(German Chancellor Angela Merkel on the Lisbon Treaty)

"I have read some of [the Lisbon Treaty] but not all of it." (Caroline Flint, former Minister for Europe)

"The primary reason why Britain entered into [EEC] negotiations was political, political in its widest sense."(Edward Heath, lecture at Harvard, 1967)

“They must go on voting until they get it right.”(Jose Manuel Barroso, President of the European Commission)

"If you go through all the structures and features of this emerging European monster you will notice that it more and more resembles the Soviet Union."(Russian dissident Vladimir Bukovsky)"The European Union is a state under construction."(Elmar Brok, Chairman of the European Parliament’s Committee on Foreign Affairs)

“I have never understood why public opinion about European ideas should be taken into account at all,”(French PM Raymond Barre)

“Let’s be clear about this. The rejection of the constitution was a mistake that will have to be corrected.”(Valéry Giscard d’Estaing)

“The 'no' votes were a demand for more Europe, not less.”(Romano Prodi, former President of the European Commission)"I don’t want an ‘in or out’ referendum because I don’t think out is in Britain’s interests.”(David Cameron, who won't hold a referendum because he thinks he'll lose)

"In Brussels one says "member state". You may imagine it means the same thing as country or state, but "member state" does not. Note that adjective. Member modifies state. Like "wooden" modifies "leg". The noun stays the same, but the essence of the thing is gone." (Mary Ellen Synon, Bruges Group Annual Conference 2013)

"No government dependent on a democratic vote could possibly agree in advance to the sacrifices which any adequate plan for European Union must involve. The people must be led slowly and unconsciously into the abandonment of their traditional economic defences, not asked…"(Peter Thorneycroft, former Tory MP)

"[Bailouts are] expressly forbidden in the treaties by the famous no-bailout clause. De facto, we have changed the treaty."(French Europe minister Pierre Lelouche)

"The transfer by the States from their domestic legal system to the Community legal system of the rights and obligations arising under the Treaty carries with it a permanent limitation of their sovereign rights... against which a subsequent act incompatible with the concept of the Community cannot prevail"(ECJ Case 6/64)

"[The EU Constitution represents] a visible move in only one direction...from intergovernmentalism to supranationalism...and this should be explained to the people of Europe"(Czech Republic President Vaclav Klaus)

"The European Parliament is a caucusing body that is incredibly responsive to lobbying institutions, but it is completely unresponsive to public opinion."(Gisela Stuart, Labour MP June 2009)

“Millions of people in this country will feel as I do, that legislation passed in this way, with no consent, cannot command the assent of the country and would lack moral and constitutional validity."(Douglas Jay MP during 2nd reading of European Communities Bill 1972)

"It is an illusion to think that [EU] states can hold on to their autonomy."(Hans Tietmeyer, head of the Bundesbank 1991)"...within ten years 80% of our economic legislation, perhaps even fiscal and social as well’ would come from the EU."(Jacques Delors, President of EU Commission 1988)

"The huge cost of the Common Agricultural Policy to taxpayers and consumers far outweighs any benefit to them..."(Memo by MAFF to House of Lords European Communities Committee 1995)

"...we must now face the difficult task of moving towards a single economy, a single political unity."(Romano Prodi, President of EU Commission 1999)

"The day of the nation state is over."(Roman Herzog, German president, 1996)

"The European system of supranationality comes at the cost of democracy."(Lord Leach of Fairford)

"The [EU] Council of Ministers will have far more power over the budgets of member states than the federal government in the United States has over the budget of Texas."(Jean-Claude Trichet, current head of the European Central Bank)

"One must never forget that monetary union, which the two of us were the first to propose more than a decade ago, is ultimately a political project. It aims to give a new impulse to the historic movement toward union of the European states"(Giscard d’Estaing, who drafted the EU Constitution 1997)

"The process of monetary union goes hand in hand, must go hand in hand, with political integration and ultimately political union. EMU [economic and monetary union] is, and always was meant to be, a stepping stone on the way to a united Europe"(Wim Duisenberg, first president of the EU Central Bank)

"Once the interlude of [WWI] was over, [countries] all went back to the rules and customs of traditional parliamentary democracies. I felt out of my depth."(Jean Monnet 'Father of Europe')

"We need to build a United States of Europe with the [EU] Commission as government."(Viviane Reding, EU Commissioner 2014)

"We had imagined a political 'grand design', a new international order..."(Jean Monnet 'Father of Europe')

"I like the English style of life. I feel more at home here in London"(Tintin creator, Belgian born Herge)

"We are not forming coalitions between States, but union among people"(Jean Monnet, 'Father of Europe')

"The sovereign nations of the past can no longer solve the problems of the present: they cannot ensure their own progress or control their own future. And the Community itself is only a stage on the way to the organised world of tomorrow."(Jean Monnet, 'Father of Europe')

"That such an unnecessary and irrational project as building a European super-state was ever embarked on will seem in future years to be perhaps the greatest folly of the modern era. And that Britain . . . should ever have become part of it will appear a political error of the first magnitude."(Lady Thatcher, Statecraft)

"There is no question of Britain losing essential national sovereignty”(Ted Heath)

Euro quotes

"Euro has done more to enforce budgetary discipline in rest of Europe than any number of exhortations from IMF or OECD". (Nick Clegg, 2002)"We're happy to give the Greeks anything, just not money".(German MEP Markus Ferber 2010)

"The Euro has been a rock of stability... Joining the single currency would be a major step".(Labour MEP, Richard Corbett, 2009)"The single currency... marks stability and growth and is crucial to high levels of growth and employment". (Tony Blair 1998)

"Staying out of the Euro will mean progressive economic isolation for Britain". (Peter Mandelson, 2003)

"The European Union must take a decisive step towards a federal economic government, with common fiscal policies and a larger budget, if it is to save the euro".(Andrew Duff Lib Dem MEP 2011)

"A European currency will lead to member nations transferring their sovereignty over financial and wage policy as well as monetary affairs".(Hans Tietmeyer, head of the Bundesbank, 1991)

The single currency is the greatest abandonment of sovereignty since the foundation of the European Community: the decision is of an essentially political nature".(Felipe Gonzalez, a Spanish former PM, 1998)

"The euro area now represents a pole of stability for those countries participating in it by protecting them from speculation and financial turmoil. It is strengthening the internal market and contributing to the maintenance of healthy fundamental figures, fostering sustainable growth".(European Council conclusions, 2001)

"We must enter the euro with a clean sheet on all the criteria".(Then Greek Finance Minister, Yannis Papantoniou, 1999)

"The reality of the euro has exposed the absurdity of many anti-European scares while increasing the public thirst for information. Public opinion is already changing…as people can see the success of the new currency on the mainland".(Kenneth Clarke MP, 2002)

"The euro is a great success, and in today’s global economy, the pound is no longer an important currency. If we are not careful, we could become like Iceland in the next financial crisis".(BT Group Chairman, Sir Michael Rake, 2009)

"I think the eurozone has turned the corner".(Then French Economy Minister, Christine Lagarde, 29 January 2011)

"I believe that, within the next twelve months, we will have averted contagion and stabilised the eurozone".(German Finance Minister, Wolfgang Schäuble, 30 December 2011)

"We cannot be members of the single market without being part of the single currency, the euro...In life, fighting for a minority view is sometimes dangerous and painful. But when you know you are right, and when so much of our national prosperity depends on it, we should expect our political leaders to act".(Virgin Group Chairman, Richard Branson, 2000)

"We are writing to make clear our concerns about the implications for business if the Government rules out membership of the euro for the lifetime of this Parliament. Such a decision would be damaging for British-based businesses, British employees and the British economy as a whole". (WPP Group CEO, Sir Martin Sorrell, et al., 2003)

"A single currency, introduced at the appropriate time, will reduce costs for businesses that trade or invest across Europe...More investment in growing businesses means more employment".(Then BP Chairman, Lord David Simon, 1997)

"Joining the euro would increase our incomes and thus our standard of living...Now the countries of Europe have taken one more step towards making a truly unified market, using only one currency. If again we delay joining, we again risk falling further behind".(Former Energy Secretary, Chris Huhne, former CBI Director General, Lord Adair Turner, et al., 2002)

"Staying out of the euro will mean progressive economic isolation for Britain. It will mean fewer foreign businesses investing here, fewer good jobs being created and less trade being done with our European partners".(Former Business Secretary, Lord Peter Mandelson, 2003)

"Britain should join the euro within the next few years in order to enhance British power and influence".(Centre for European Reform Director, Charles Grant, 2001)

"Joining EMU would offer multiple benefits...The euro would be good for jobs".(Then TUC Secretary General, John Monks, 2003)

"As time goes on, people will increasingly see that there is a price to be paid for remaining outside the euro".(Former Labour Party leader, Neil Kinnock, 2002)

"The euro may well come to be regarded in the coming years as part of the answer to saving the City from permanent decline. It was easy to dismiss the fledgling euro as a ‘toilet currency’ before we realised our own economic growth was built on sand".(Lib Dem leader, Nick Clegg, 2009)

"Obviously joining a currency that everybody in Europe - including soon all the new European Union members - are using, a currency that American and Japanese and overseas businesses understand, has to make sense".(Then UK Europe Minister, Denis MacShane, 2003)

"The euro, despite gloomy predictions from anti-Europeans, has proved to be a success".(Former Lib Dem leader, Charles Kennedy, 2002)

"In reality the economic integration between Britain and the Continent is so close, and we have confirmed this because we all belong to the common market, that it can't be good in the long run to stay out of such a cardinal element as the currency union".(Then German Finance Minister, Hans Eichel, 2002)

"There are no real benefits and some real costs to the UK of monetary independence... it makes sense from a financial stability perspective for the UK to contract out monetary policy to the ECB".(Citigroup Chief Economist, Willem Buiter, 2007)

"Taking part in EMU would improve policy and performance enough to eliminate many of the strains that sceptics predict would emerge without the safety valve of devaluation".(BBC Trust Vice Chairman, Diane Coyle OBE, 1997)

"The euro is like a breastplate that will become more and more resistant. The stability of the currencies within its area is without question".(Then EU Monetary Affairs Commissioner, Yves Thibault de Silguy, 1998)

"The strict rules attached to the euro could emerge as one of the best ways to persuade the markets that we will put Humpty Dumpty back together again, put the public finances in order".(Lib Dem leader, Nick Clegg, 2009)

"The question of entering the euro is worth a lot more to Britain than the wild anti-federalist fantasies peddled by those who think Britain should have nothing to do with Europe. Nobody of any consequence in Europe wants to create a federal super-state".(Former Business Secretary, Lord Peter Mandelson, 2003)

The British Government Knew The Consequences In 1971

...the transfer of major executive responsibilities to the bureaucratic Commission in Brussels will exacerbate popular feeling of alienation from government. To counter this feeling, strengthened local and regional democratic processes within the member states and effective Community regional economic and social policies will be essential.Parliamentary sovereignty will be affected as we have seen. But the need for Parliament to play an increasing (if perhaps more specialised) role may develop. Firstly, although a European Parliament might in the longest term become an effective, directly elected democratic check upon the bureaucracy, this will not be for a long time, and certainly not in the decade to come. In the interval, to minimise the loss of democratic control it will be important that the British Parliamentarians should play an effective role both through the British membership in the European Parliament and through the processes of the British Parliament itself.